Huberty, who has an Overweight rating on the shares, reiterates a $540 price target, and raises her fiscal Q4 estimate to $37 billion in revenue and $8 per share in net profit from a prior $35.78 billion and $7.51 per share, to reflect sales of perhaps 34.5 million iPhones, up from a prior 31-million estimate.

For next year, she raises her estimates to $180.26 billion and $44 per share from a prior $172.2 billion and $41.53, on sales of 171 million iPhones, up from a prior 169 million.

Huberty thinks Asia, specifically China and Japan, may drive a lot of the activity, though she also thinks “trade-ins” of used phones could help:

Our CY14 base case iPhone model assumes China/Japan drive half of new users with new users in other regions dropping 24% as the smartphone market matures. We forecast a consistent 2.5 year upgrade cycle, though trade-in programs could accelerate upgrades in the bull case. iPhone 5c captures the highest mix, at 47%, with 5s making up 38% of shipments in the base case. Given strong first weekend 5s sales, our bull case assumes mix reverses.

For those of you playing at home … there’s an app for that! A Web app, actually, as Huberty has posted an online, interactive model for iPhone and how various assumptions can affect Apple’s results. You can access it on Morgan Stanley’s Web site.

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Comment

There are 9 comments

SEPTEMBER 24, 2013 5:50 P.M.

Ed wrote:

Wow, who gives a F. Stock blows

SEPTEMBER 24, 2013 6:03 P.M.

Mike wrote:

Katy Huberty is one the few analyst who actually get it right. I see through all the noise and garbage analyst put out there and this week still made excuses for getting it wrong on Apple weekend launch,,, Thats you Gene M

SEPTEMBER 24, 2013 8:17 P.M.

Sal wrote:

Gene Munster. STFU. You were wrong. Just STFU

SEPTEMBER 24, 2013 9:29 P.M.

Bob wrote:

Nice Sal well said!

SEPTEMBER 24, 2013 10:19 P.M.

kband wrote:

Whats wrong in admitting your mistake!!!

SEPTEMBER 24, 2013 10:22 P.M.

kband14 wrote:

Last month Mr. Misek upgraded BBRY and downgraded Apple based on his channel checks. Now we know Misek how reliable your channel checks are.

SEPTEMBER 25, 2013 12:52 A.M.

Re Misek wrote:

Yeah. When Pac Crest said people were returning their new Blackberry Z10s... Misek said his UK channel checks indicated the new Blackberry was selling great. How great? In the last three years in the UK Blackberry's brand has fallen from fourth place in the UK to 180th. Way to go Jeffries. You can pick them.

SEPTEMBER 25, 2013 9:48 A.M.

Anonymous wrote:

I just checked out eBay, and the unlocked 64GB iPhone 5S is consistently receiving bids over $1100-1200.

SEPTEMBER 26, 2013 10:14 P.M.

Phillip wrote:

I think we can all agree ,,, these analyst throw out what they want things to be, they don't know any more than we the average investor do,,, and unfortunately these ding dongs get the pleasure to ask questions on earnings calls and we can't. Shows it rigged against the little guy......

About Tech Trader Daily

Tech Trader Daily is a blog on technology investing written by Barron’s veteran Tiernan Ray. The blog provides news, analysis and original reporting on events important to investors in software, hardware, the Internet, telecommunications and related fields. Comments and tips can be sent to: techtraderdaily@barrons.com.